5 Considerations To Make When Selecting A Retail System
By Afshin Alikhani, Founder and Chairman, Retail Realm
In my last 26 years of working in the retail IT industry, I have often had to explain the similarities and differences between small and large retailers’ software and hardware requirements when looking for a store management solution. Every year I revise my things-to-know list based on changes in the industry, but one fact remains constant: the obvious similarities and differences go way beyond a retailer just being small or large.
Here are five considerations in selecting an optimal retail system, whether you’re a small or larger retailer.
1. Millennials And Ecommerce
Both small and the large retailers are responding to the growing trend where millennials buy mostly online and do comparative web price shopping. Businesses know in order to compete and survive in today’s Omni channel world, it’s mandatory they have a strong web presence to actively engage and sell to millennials.
Retailers also know though how important it is to get the sale before millennials walk out of the brick-and-mortar store. A top concern of many retail owners is these consumers are using the local physical store only as a visual product catalog to ‘touch’ or ‘try out’ the items but then walk out only to buy those items online from the lowest price competitor.
Today’s leading e-commerce solution providers, like UniteU, have responded to this growing trend by giving the brick-and-mortar retailer the ability to automatically identify what items in-store customers are comparing online via their mobile devices and then digitally provide the customer a discount voucher that motivates him/her to buy the item in the store in the same visit.
Consider the case of Joe Smith, for example. He enters an electronics store to try out a certain computer laptop. He’s interested in buying it but wants the lowest purchase point. He then uses the store’s Wi-Fi connection to digitally search for that same laptop and finds it’s available for a cheaper price at a different company online. Instead of losing that prospective consumer’s business, the electronics store owner’s e-commerce solution would identify Joe’s online item search and automatically give him a voucher or discount that prompts him to buy the laptop in the store.
2. Inventory Management
Retailers have always worried about inventory control since the moment humans started trading as far back as the ancient Egyptians and the Babylonians. This includes ordering the product, at the right price, and delivering it in time to the store without causing inventory overstock problems. Currently, most retail systems manage this with different levels of competence.
However, multi-channel and Omni-channel retailing have recently introduced an additional level of complexity. The retailers I talk to tell me, “I need to make sure my web shows the right stock level aligned with my physical store. If consumers buy something online but I do not have it in stock, I will lose more than one sale — I will lose a customer.”
Today’s retail storefront is not just the high street, but includes their website, eBay, Amazon, Facebook, Groupon, etc. Your retail management system needs to control all these mediums and tell you analytically which program and channel are growing your sales and margins so you can order and manage your stock correctly for every season — online and in store.
3. Trend Analysis And BI
Data and number overdose can quickly overcome retailers, and so retail solutions have focused on corralling this information from all different sources and making it available in one place. But it is only with Business Intelligence and meaningful dashboards that perform trend analysis and exception reporting that retailers can actually decide what correct action they should take.
Microsoft has already gotten ahead of this by providing an affordable PowerBI solution as part of their office and Dynamics 365 subscription.
4. Security
I cannot remember a time when people have been more concerned about security than today. In the past, we used to carry our identity in our wallet and flash it only when we had to. Our credit cards were manually handled and fraud was limited to the carbon copy of the card being stolen and misused.
In the digital world, however, our identity — both as individuals and as organizations — is constantly exposed and shared across digital mediums hundreds of times each day, knowingly or unbeknownst to us.
Now credit card companies, payment processors, and retailers all have to work together to protect our identity at the point of capture as well as in their data centers. But one of the biggest problems in the security chain is … us. We often reveal too much detail about ourselves, which can then be used against us.
Case in point: although last year’s Target breach exposed only one aspect of data security, the ripple effect was felt large and wide. For example, one of my winery customers that performs reoccurring billing as part of their wine club subscription lost 30 percent of their clientele. When the winery called customers to say their credit card was not working, most of those customers cancelled their orders — and future business. This was due in part because they no longer trusted that their card data would be protected.
Of course, if such features as Auto Updater had been implemented into the company’s retail management system, those lost or cancelled cards would have been automatically updated with the card encrypted token. It’s why I always advise retailers on the hunt for the ideal payment processor to find out if this Auto Updater functionality is supported.
As security is one of the top concerns of retailers, I am closely and continually following industry security best practice recommendations. If you are looking for the latest news and updates about this topic, I strongly recommend following the FIDO Alliance.
5. User Experience
About 10 years ago, I was with my father when a young teenage boy asked him about the speed of sound, a subject this ambitious Xbox battle-gamer found fascinating. I listened to my dad explain in a very simple and understandable way the concept of speed, the speed of sound, and the speed of light. I was impressed. “Most people who cannot explain complex concepts in a simple way usually do not really understand the topic,” my father later told me. And he was right.
Since then, I’ve always made sure to look closely at every software product through the lens of the user. Yes, this solution might include all the necessary features and functionality, but does it have an intuitive user interface? Will the user be able to easily learn and quickly navigate it?
I initially fell in love with IT back in the day working with IBM system 34, 36, and AS400. At that time, the issues of a clean user interface and ease-of use were not a consideration partially because of the limitation of those systems in being mono color text driven applications.
I’m happy to see that with the amount of memory, storage space, and graphical capabilities the systems of today have, those limitations no longer exist. However, solution developers are challenged to write software that not only fulfills customer requirements but also looks good with a simple and consistent workflow.
User Interface (UI) experts are typically not part of most small, independent solution development teams, however, which can prevent adherence to design guidelines of companies like Microsoft. They do not have the resources to leverage Microsoft’s modern clean tile approach or Apple’s user interface guidelines that can remove much of the design guesswork and provide the developers with the tools for a great software look and feel.
I am still surprised when I look at the badly designed workflow and UI of some of today’s retail solutions. Unless the UI is clean, standardized, and intuitive — and the development team has meticulously followed the domain specifications — I would not recommend that solution to any retailers as it increases training time, leads to user frustration, and ultimately does not serve the needs of the specific vertical or market.
Having studied almost all of the service solutions currently available, I believe that Microsoft Dynamics 365 is one of the strongest leaders in this field. If you have never looked at it, I strongly suggest you do.
Afshin Alikhani is a business operational analyst with 30+ years in the computer software industry developing organizational end-to-end processes for companies primarily in the retail and hospitality sectors. He is the Founder and Chairman of Retail Realm, a leading multinational retail-centric software development and distribution company.